2021 Francophone Games could cost taxpayers seven times more than expected

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The Francophone Games could cost taxpayers seven times more than expected.

The Moncton-Dieppe bid was selected to host the 2021 Games — considered the biggest sporting and cultural event in the French-speaking world — based on a $17-million budget submitted back in 2015.

But Radio-Canada has learned the request for funding by the Games’ organizing committee, first submitted to government back in April, is for $130 million, raising questions about whether hosting the games in New Brunswick is still a viable option.

The municipalities of Moncton and Dieppe were supposed to contribute $750,000 each, with the rest of the money split evenly between the federal and provincial governments.

But various levels of government are now saying they might not be able to afford the difference.

New Brunswick’s Progressive Conservative government said it was shocked to find out the price tag when it took office.

« To our surprise, there were no funds approved in the budget for the Games, » said Louis Léger, Premier Blaine Higgs’s chief of staff.

« We were incredibly surprised.

Louis Léger, chief of staff to Premier Blaine Higgs, said the province is concerned about the inflated price tag. (CBC)

Léger said he is not ready to say the Games are in jeopardy, but he is unsure where the funds will come from.

« We have to recognize New Brunswick is a small province, » he said, leaving the ball in the court of the federal government.

But Ottawa said it will not contribute more than 50 per cent of the cost of running the Games.

« We’re obviously worried by the potential cost, » said Intergovernmental Affairs Minister Dominic LeBlanc.

« It’s important now for New Brunswick to assume its responsibility, and we’ll be an important partner in the Games. »

Intergovernmental Affairs Minister Dominic LeBlanc said he can’t imagine Moncton-Dieppe won’t host the 2021 Francophonie Games. (CBC)

LeBlanc said the federal government could pay 50 per cent of the new costs but, according to federal policy on funding for international sporting events, it would not go beyond more than half the overall price tag.

The minister said he is looking forward to continuing discussions with the province.

« I can’t imagine the provincial government would give up on the Games, » he said.

« I can’t imagine the Francophonie Games wouldn’t take place in New Brunswick in 2021. »

No false pretences

The $17-million bid was based on a suggested financial framework in the International Organization of the Francophone Games guide, explained Eric Larocque, executive director of the 2021 Games organizing committee.

The $130-million price tag, he explained, is the full business plan, which the committee wasn’t required to submit as part of its bid.

In contrast, the City of Sherbrooke, Que., who also made a bid to host the games and lost, had a $50-million business plan as part of its application.

Larocque rejected the idea the committee won its bid under false pretences but agreed it would have been « the right thing to do » to submit the business plan from the get-go.

Eric Larocque, executive director of the 2021 Games organizing committee, said the committee wasn’t acting under false pretences when it submitted its $17-million bid. (CBC)

« Of course, yes, » said Larocque. « But it was not asked from us, so we didn’t.

« There were some volunteers, and there were some public servants. I’m not here to pinpoint or to blame somebody. It was a group decision, and that’s it. »

Larocque said he could not provide details about what items were part of the business plan, short of confirming a request for infrastructure was made.

When Moncton won the bid, the city said « the beauty » of its bid was that it already had all the infrastructure required — referring to the stadium at the University of Moncton and the new Avenir Centre — and there wouldn’t be any costs associated with that.

Officials from the International Committee of Games of La Francophonie met with Moncton-Dieppe officials and organizations to talk about bid for 2021 games in the 2015 file photo. (Jennifer Choi/CBC)

Larocque said governments could decide to provide only a portion of the money requested by the organizing committee.

« I don’t think we’re going to lose the Games. They need to talk and to find a solution, » he said.

« We’re going to do the best with the money we’re going to get. »

He said the funds would have to be approved by January for the committee to be on schedule.

The City of Moncton said it approved a financial contribution of $750,000 toward the Games, as part of its 2017 budget deliberations, and that no further request for funding has been made to the city by the local organizing committee.

The province meanwhile remains concerned.

« We inherited this situation, » said Léger. This worries us to the highest degree. To see that such an important event had not been as well planned as it should have…

« It’s a 664 per cent increase. It’s not just forgetting a small element of the project. »

Since they were created in 1989, the Games have been held in Morocco, France, Lebanon, Ivory Coast, Madagascar and Niger.

Canada last hosted the event in 2001 when it was held in Ottawa and Gatineau, Que..

The Games are expected to draw 4,000 visitors to the Moncton area in 2021.

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Trudeau government would reject Jason Kenney, taxpayers group in carbon tax court fight

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The Trudeau government has told the Saskatchewan Court of Appeal it should not grant intervenor status to Jason Kenney’s United Conservative Party or the Canadian Taxpayers Federation in a key test case on the constitutional right of the federal government to impose a national carbon tax.

The brief, submitted to the court Wednesday by federal lawyers, argues that the Saskatchewan court should reject a request from the UCP to be an intervenor because its contribution would be “political and speculative.” It says the court should similarly reject a request from the CTF because the it “has not established any special expertise in general economics or the economics of carbon pricing.”


READ MORE:
Agricultural Producers Association of Sask. hoping to join fight against carbon tax

The case before the Saskatchewan Court of Appeal was brought by the government of Saskatchewan Premier Scott Moe, who opposes any carbon tax. Moe has been joined by Ontario Premier Doug Ford, Manitoba Premier Brian Pallister and New Brunswick Premier Blaine Higgs in opposition to the federal carbon pricing plan.

On the other hand, the federal government has consented to requests by eight other organizations to have intervenor status in the case. They are:

  1. Saskatchewan Power Corporation and SaskEnergy Inc.
  2. Athabasca Chipewyan First Nation
  3. Canadian Environmental Law Association/Environmental Defence Canada
  4. Canadian Public Health Association
  5. David Suzuki Foundation
  6. Ecofiscal Commission
  7. Intergenerational Climate Coalition
  8. International Emissions Trading Association


READ MORE:
Saskatchewan’s carbon tax court challenge to be heard in February

The federal government also argues that the court in Saskatchewan should reject requests for intervenor status by the Agricultural Producers Association of Saskatchewan and the Assembly of First Nations. It says those groups “do not address the constitutional issues before the court.”

Developing.

 

© 2018 Global News, a division of Corus Entertainment Inc.

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Canada Revenue Agency is tough on regular taxpayers but goes easy on those with offshore accounts, audit finds

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The tax man goes easy on wealthy Canadians with offshore bank accounts while being harsh on regular taxpayers, according to a damning report made public by the federal auditor general Tuesday.

Wealthy tax cheats are given more time to find receipts and they get their interest and penalties waived, even if they didn’t ask for it.

Meanwhile, if a salaried employee can’t find a receipt, it’s automatically disallowed and they’re reassessed, the report said.

“Most taxpayers are individuals with Canadian employment income. We found that the (Canada Revenue Agency) requested information from these taxpayers more quickly, and gave less time to respond, than it did with other taxpayers, such as international and large businesses, and taxpayers with offshore transactions,” said the report.

Auditor General Michael Ferguson highlighted a double standard that many Canadians have personally experienced, where the CRA aggressively pursues regular people for small amounts of tax owing, while offering amnesty and anonymity for those involved in sophisticated offshore tax schemes.

In the five years from 2013-2018, the CRA accepted voluntary disclosures from 140 people who were already being audited, and waived $17 million they owed in interest and penalties.

The voluntary disclosures program, which encourages tax cheats to come clean by pledging not to prosecute them and offering to waive some or all of their penalties, has since changed its rules to prevent those who are already being audited from taking part.

“Does the CRA have a culture of conveniently ignoring tax-evaders who have the means to hire a lawyer?” asked Green Party Leader Elizabeth May in reaction to the report. “The CRA needs to shift its Sheriff of Nottingham approach to tax-collection and have the rich pay their fair share rather than concentrate audits on hardworking Canadians because it’s easier to have them pay.”

In response to the report, Revenue Minister Diane Lebouthillier pledged to “ensure that our tax system is fair for everyone, throughout Canada.”

Ferguson’s team put together a list of eight recommendations that focused on the lack of consistency in how the CRA applies tax law. Consistency, the auditors pointed out, is enshrined in the Taxpayer Bill of Rights. They nevertheless found wide discrepancies in how people were treated by the CRA depending on their region and activities.

In one example cited, the CRA gave regular taxpayers 90 days to produce a receipt and automatically disallowed the deduction if it wasn’t provided in time.

But those with offshore transactions were given much more time to produce documents, and that timeframe “was sometimes extended for months or even years.”

“Sometimes, the agency did not obtain information at all, and the file was closed without any taxes assessed,” the report stated.

On average, the CRA took more than 18 months to complete audits that included offshore activity.

“The CRA continuously strives to apply the law consistently while taking taxpayers’ individual circumstances into account,” Lebouthillier said in a statement. “The agency will review its internal processes and procedures to ensure its compliance work follows sound and transparent processes.”

Since the Panama Papers were made public in 2016, the Liberal government under Prime Minister Justin Trudeau has added more than $1 billion to the CRA’s budget to crack down on tax cheats, with a focus on those using complex offshore schemes.

In the last two years, the CRA says it has collected $21.5 billion in additional revenues from the stepped-up audits and other compliance activities.

But Ferguson’s report says those numbers are not only imprecise — based on estimates rather than actual revenue — they’re also overstated.

“The additional revenue the agency reported … did not reflect the taxes that it could not collect from taxpayers. This means that the impact on the government’s fiscal results was significantly less than what the agency estimated,” the report stated.

The auditors found the CRA reported at least $1.3 billion in additional revenue that was never collected.

“This previously reported additional revenue will never be collected because the assessments were overturned through the objection process,” the report said.

Lebouthillier agreed that reporting could be improved.

“I agree with the auditor general’s recommendations related to improving reporting and processes,” Lebouthillier said in a statement. “The CRA has already started to produce more strategic performance indicators, such as the tax gap estimates launched in 2016. The CRA will continue to build on this work with additional estimates to better report on our successes to Canadians.”

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Marco Chown Oved is a Toronto-based investigative reporter. Follow him on Twitter: @marcooved

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